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Friday, 20 July 2018

Is it Worth Joining A Co-Operative?

In a previous
post, I wrote about what credit
co-operatives (co-ops) do and the important role they play in society. I’ve
also received some questions from readers as to whether it is worth joining a
co-operative in Singapore, especially if they qualify for one.

After looking through all the benefits, I’m
convinced that being a member of a co-op has its benefits and privileges.

Open to all staff who are employed in the civil service, statutory boards
and government-linked companies, SGSSC provides the resources to help its members
build a better future.

According to SGSSC’s website, there are three saving options for members:

·Subscription Saving

·Specific Deposit Saving

·Fixed / Time Deposits

Working in a similar fashion as the Singapore Savings Bonds (SSBs, which fans will know I’m a huge
advocate of), SGSCC’s saving schemes offer competitive interest rates, while granting you the
flexibility to withdraw your savings in times of need.

Moreover, all co-ops including SGSCC are regulated by The Registry of
Co-Operative Societies of Singapore (under the purview of the Ministry of Community,
Culture and Youth), and are required to have their accounts regularly audited. SGSCC’s
long track record and history attest to their sustainability.

The only credit co-op that has almost no restrictions (other than you
needing to be a Singaporean or Permanent Resident) for joining as a member
would be the TCC
Credit Co-operative.

Apart from providing access to affordable financial solutions, TCC also
allocates some of its surpluses to assist members in times of need through its
Common Good Fund like hospitalisation grant, marriage grant and educational
scholarships and bursaries awards. TCC also distributes dividends to its
eligible members every year.

TCC members can even enjoy exclusive health screening packages at preferential
rates at Thomson Medical. And should members get hospitalised, they can put in
a claim for a hospitalisation grant of $30 per day (just like how the payouts
on your insurance work, except that you don’t have to pay any insurance
premiums for this one).

It’s also fuss-free to open a Savings Account as there are no
administrative or membership fees involved. Their Subscription Savings Account,
for instance, usually pays out 3% - 5% in dividends annually, which can be higher
than other high-yield bank accounts which I’ve reviewed before on this blog!

Education Loan
Options

TCC also provides its members with access to education loans at a flat
interest rate of 2.2% per annum (p.a). Compare this to the likes of OCBC’s
Frank Education Loan, which charges 4.5% p.a. (or effectively 5.17% per year if
you pay it off within 2 years).

For
Union Members

AUPE Credit Co-Operative Limited
is open to all union members. Members can also enjoy the provision of financial
solutions, such as loans from as little as 4%* including medical loans for
medical expenses or treatment costs, renovation loans (under $30k) to tide over
getting your new home in order, and even study loans or grants for your children.
In addition, should any member be hospitalised, you will also get a hospital
benefit of $20 per day without the need to purchase any extra hospitalisation
insurance.

Alternative Financial Solutions

I’ve mentioned previously that if you are seeking financial solutions, other
than financial institutions, there are alternatives and one of them is credit
co-ops. Credit co-ops are less profit driven than most commercial enterprises,
and have a social mission, thus they are more willing to go the extra mile for
their members.

Financial solutions dispensed by credit co-ops generally have a more
flexible repayment period (up to 48 months) to help members manage their cash
flow without feeling as though they’re being driven up the wall just to repay
the loan.

Whether you need a short-term financial solution
because you’ve unexpected medical expenses to pay off, or for your children’s
educational needs, you may look at different forms of financial assistance
including credit co-ops. If you’re unable to repay on time, you can also be
rest assured that credit co-ops will do their best to help come up with a
reasonable debt repayment schedule that meets your needs.

Where, then, does the money or interests
earned by credit co-ops go to?

Well, surpluses earned by the credit co-ops are channelled back to its members
in the form of benefits such as annual dividends (members of SGSCC received 3%
dividend in their subscription capital in previous years), hospital benefits,
or even educational awards and bursaries to members or their children.

Man, I wish my dad had joined SGSCC back then,
so we could tap on their education bursaries with my good grades to help me
tide through school! Unfortunately, he and none of us in the family knew about
SGSCC, but now YOU do!

What Types of Co-ops Are There?

There are plenty of co-ops available in Singapore, but they generally
fall under these categories:

1.Campus co-ops

Formed in educational
institutions, campus co-ops offer students and staff the platform and opportunity
to develop their entrepreneurial skills. Examples include The Co-operative
Society of Nanyang Technological University Ltd (NTU@COOP), Ngee Ann
Polytechnic Consumer Co-operative Society Ltd and Temasek Polytechnic
Co-operative Society Ltd.

2. Credit co-ops

Also known as Thrift &
Loan societies, credit co-ops play an important role in improving the economic
and social statuses of their members through no-frills saving schemes that
encourage thrift.

To learn more about co-ops, head
over to SNCF’s website! And
most importantly, if you qualify for any of the co-ops, you might just want to consider
whether it’ll benefit you to join, especially given all the solutions and
benefits that they offer.

Disclaimer: This is a sponsored post written for
the Singapore National Co-operative Federation to promote greater awareness of
co-operatives in Singapore in conjunction with the World Credit Union
Conference which is being held in Singapore for the first time. All opinions
are that of my own.

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You can call me Dawn, and this little space on the Internet is where I write about becoming financially-free. Join me as we learn more about savings, budgeting, paying off debts, insurance and investing together!

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Disclaimer

Please note that all statements published on this blog are solely opinions of my own i.e. of a personal nature, and should not in any way be taken as statements of fact. Readers are encouraged to do their own research before arriving at any conclusions based solely on materials provided, or republished, on this blog.